"Since 2008/2009 when the Fed pumped the world with cheap credit in the wake of recession caused by pumping the world full of cheap credit, Vancouver real estate prices, as well as the rest of Canadian real state, has been climbing and climbing, to the point that now Vancouver locals can’t even afford a home."
In this video Dan Dicks of Press For Truth explains that for Canadians, it all comes back to the Bank of Canada. By manually lowering interest rates through open market operations, they’ve left the private Chartered banks more leveraged and less capitalized than the American banks were in the run up to the 2008/09 recession.
What's happening here will happen everywhere!
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This is true I see it seeping into Kamloops people from Vancouver will sell one house and move here and buy two but now you can't even do that. As for the collapse it will come and I think people are already catching on.
As I'm in the business of construction and this summer has been the worst I've seen including 08' that to me is a good sign people are stopping building. It's funny to because on local Kamloops news they where saying it was. The best year for houses . That's funny seeing I sat for weeks on end and still em behind struggling due to the slow down.
Yikes. Hearing this from someone in the construction business has me really concerned. I rent but my mother recently sold her home and bought an expensive new home instead of downsizing. She thinks she has made a great investment that will pay off for her kids down the road but I have my doubts about that. I wonder if rental rates will drop as well? I'm paying $1400 for a small condo!
Well I hope in the future that investment works out for her. But I know we have a down trend coming , maybe for a year or two or maybe more. What I do know is I have been working non stop, for last ten years on brand new houses. And now it's getting bad. Every one says I'm crazy but what can yah do.
Worldwide markets are on the brink of popping...this economic boom is starting to be one of the longest in history...how long can it last?
The prices in Vancouver especially are WAY out of control. When I was out there for a year doing renovations, I couldn't believe the prices of houses that needed to be torn down, literally. Houses that in Ontario, you couldn't even give them away, but were selling for $1.5 million and flying off the shelves.....lol. There was a 3 bedroom tear down in British Properties that sold for something like $24 million. Insane!
I was living in Burnaby at the time and the neighborhood behind me was full of $3 million plus homes that were completely empty. Hundreds of houses with very few people living in them. All owned by offshore Chinese. Same with the ghost towers downtown. Whole towers are pretty much empty, but all the units have been sold. Its that offshore money that is driving the prices up and thats coming to an end. The crash will be very hard because a ton of the houses are in rough shape and won't be worth much on the open market. So many people buy these houses and then have zero money to maintain them. Not to mention the terrible contractors who do the work if they do. What a mess!
Great Work Dan. I hope all Canadians watch this.
Having lived here my entire life, I've become accustomed to hearing this. Every year since 2006, we've been told that the bubble on the Vancouver housing market will burst...and every year prices go up a little higher. I wish I had bought six years ago when I could have afforded a modest townhouse just outside the city but my brother, a real estate agent, advised me to wait a year. The following year, prices had gone up 12% but everyone was saying prices would plateau and drop for sure. That 300K townhouse in 2010 is now priced at 685K and way out of my league. Like so many others, I'm contemplating a move out to one of the smaller towns on Vancouver Island.
Any suggestions Dan? I've a home and am up for renewal soon. I don't see any way to mitigate my risk other than by renewing for a 10yr fixed, so that if there's any volatility in the market, we can hopefully ride it out.
Cheers! Keep up the good work!
youd think has to happen sooner or later
cant keep going up forever otherwise itd be the first bubble that did =-/
Great article. Was happy to share on Twitter. Stephen.